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This blog is definitely what many would call an occational blog. While I have enjoyed toying with the blogging concept, I believe my time would be better spent going in a new direction – providing even more value to direct clients. And so, I am discontinuing this blog in favor of integrating more client-resources with my firm’s website, accessible at www.mitchellip.com. It has been a fun couple of years, and I am sincerely grateful to those who have authored articles for the IPIP Blog.

The American Bar Association (ABA) Journal has announced an interesting new project featuring those willing to take chances on new ways of practicing law. And, based on my review, these are truly novel approaches! As stated in the announcement:

Over the course of the next three months, we’ll be profiling 50 of the profession’s leading innovators at http://www.legalrebels.com . The first seven profiles, along with videos and audio slideshows that illustrate the changes they’re trying to make in the practice of law, are now online. We’ll be adding at least three new profiles to the site every week until Thanksgiving.

Over the course of the next three months, we’ll be profiling 50 of the profession’s leading innovators at http://www.legalrebels.com . The first seven profiles, along with videos and audio slideshows that illustrate the changes they’re trying to make in the practice of law, are now online. We’ll be adding at least three new profiles to the site every week until Thanksgiving.

On October 30, 2008, the Court of Appeals for the Federal Circuit (CAFC) decided In re Bilski, which pertains to the eligibility of method claims as statutory subject matter under 35 U.S.C. § 101. This case significantly modified the standard for evaluating subject matter eligibility with respect to method claims. In this decision, the CAFC held that a “claimed process is surely patent-eligible under § 101 if: (1) it is tied to a particular machine or apparatus or (2) it transforms a particular article into a different state or thing. See Benson, 409 U.S. at 70 (‘Transformation and reduction of an article ‘to a different state or thing’ is the clue to patentability of a process claim that does not include particular machines’)” (see Slip op. at 10 and 11 (Fed. Cir. 2008)). In other words, Applicants have two options with respect to writing statutory method claims: (1) either recite in the claims that the steps thereof are performed by a specific machine or apparatus; or (2) argue that a transformation takes place in the method.

Tying method claims to a specific machine or apparatus may unduly limit the claim scope, depending on what is claimed. For instance, if Applicants choose to tie the claims to a “computer” or a “processor,” certain otherwise-infringing devices may be deemed not to fall under the scope of the claims. For instance, with respect to a computer, a PC and a laptop are likely to qualify, but what about PDAs, cell phones, tablet devices and other electronic devices that are becoming increasingly capable of carrying out the functions typically associated with a computer? With respect to a “processor”, such a feature may run the risk of characterization as the general CPU of the device. If certain features are carried out by a subcontroller or some other non-CPU device that performs logical operations, a Court may potentially deem such features not to be performed by a “processor.” While new applications may be written to include such devices in the scope of a computer, a processor, or whatever structure is chosen (after all, an Applicant can be his or her own lexicographer), existing applications do not share this luxury.

Further, In re Bilski has left the determination as to whether tying features of a method claim to a “general purpose computer” is sufficient to tie the claim to a particular machine or apparatus for a future decision. As Judge Newman noted in her dissent in In re Bilski, “[w]e aren’t told when, or if, software instructions implemented on a general purpose computer are deemed ‘tied’ to a ‘particular machine,’ for if Alappat’s guidance that software converts a general purpose computer into a special purpose machine remains applicable, there is no need for the present ruling” (see Judge Newman’s dissent in the Slip op. at 35 (Fed. Cir. 2008)). With such potential limitations to claim scope and the specter of a potential decision disqualifying a general purpose computer as a sufficient machine or apparatus in the future, it may be preferable to argue that software-based method claims qualify as statutory subject matter under the second prong of the In re Bilski test − namely, that the features recited in software-based method claims transform an article.

The “Transformation” Prong

With respect to the transformation of prong (2), In re Bilski elaborated on the requirements for meeting the second prong of the Benson test. First, the transformation “must be central to the purpose of the claimed process” (see Slip op. at 10 and 11 (Fed. Cir. 2008)). The CAFC held this means that the transformation in question must “impose meaningful limits on the claim’s scope” and not “be insignificant extra-solution activity” (Id.). Generally, the active verb at the beginning of a step in a method claim, such as “prioritizing”, “allocating”, “fetching”, “storing”, “receiving”, or the like, will limit the claim and be important for the claimed invention (otherwise, such limitations should probably not be included in the claim). Thus, the operations of such active verbs should be deemed to be substantially central features to their respective claims and do not constitute extra-solution activity as they are arguably at the heart of the claimed subject matter.

Second, the CAFC held that the transformation only qualifies as patent-eligible subject matter if it transforms a certain type of “article.” “[T]he main aspect of the transformation test that requires clarification here is what sorts of things constitute ‘articles’ such that their transformation is sufficient to impart patent-eligibility under § 101” (Id. at 24 and 25). The majority in the In re Bilski decision stated that “[t]he raw materials of many information-age processes, however, are electronic signals and electronically manipulated data” and that “[s]o long as the claimed process is limited to a practical application of a fundamental principle to transform specific data, and the claim is limited to a visual depiction that represents specific physical objects or substances, there is no danger that the scope of the claim would wholly pre-empt all uses of the principle” (see Id. at 25 and 26). However, claiming a “visual depiction” of data representing physical objects is not within the scope of many software inventions.

It appears that the CAFC is primarily concerned about Applicants claiming all practical uses of a scientific principle. “Diehr can be understood to suggest that whether a claim is drawn only to a fundamental principle is essentially an inquiry into the scope of that exclusion; i.e., whether the effect of allowing the claim would be to allow the patentee to pre-empt substantially all uses of that fundamental principle. If so, the claim is not drawn to patent-eligible subject matter” (Id. at 8 and 9). In the decision, the CAFC appears to take the position that all software methods are directed to algorithms. However, this is not the case, as claims may include features such as which data is to be stored, i.e. the content of a packet header or the like. Clearly, a data structure is not an algorithm. However, rather than embarking down the slippery slope of arguing whether the data in software claims conforms with the aforementioned requirements, it may be more effective to argue that a physical device is transformed − namely, memory.

Transforming Memory

Because software inherently requires some form of storage in order to be executed by a device (otherwise, said software exists in the abstract only and is not patent-eligible subject matter), such as RAM, cache memory, hard disk, tape drive, optical drive, etc., a practitioner can argue that the method steps cause memory to undergo a physical transformation without creating prosecution history estoppel that would be useful to an adverse party. Thus, arguing something similar to the following in Responses traversing an In re Bilski-based rejection under 35 U.S.C. § 101 may be helpful.

In the context of a network system such as that described in some embodiments in the present specification, Applicants submit that a person of ordinary skill in the art would readily appreciate that practicable embodiments of the claimed invention would be conducted with the aid of a computing machine, such as a server. Such computing machines are commonly understood to have memory. Further, the operations recited in the claims clearly change the state of the underlying data since the cache, register, or other memory on which the data is stored must be transformed to have a different magnetic polarity, electrical charge, or the like depending on the technology that is used. These are real physical changes. Further, memory is a real physical article. As such, Applicants submit that the method claims perform a transformation under the “machine or transformation” test and thus qualify as patent-eligible subject matter.

It will likely be difficult for an Examiner to find any legal evidence in support of an argument that state changes in memory do not qualify as physical transformations, and the majority in In re Bilski did not take such a position. An alternative interpretation is unreasonable since a transformation of memory is necessary for machine-executable code to be executed by a device.

Conclusion

In sum, it is inherent that practical applications of software-based inventions physically transform some type of memory. Accordingly, Applicants may choose to argue that their software-based method claims comply with the transformation prong when presented with a 35 U.S.C. § 101 rejection referring to In re Bilski. Dissenting judges alleged flaws in the majority’s reasoning in In re Bilski, and Judge Newman’s dissent is very well-reasoned, logical and persuasive. We note that the United States Supreme Court may decide to hear the case and eventually modify or overturn the CAFC’s decision. Nonetheless, In re Bilski establishes new law with respect to method claims that will have to be addressed in many cases, at least for the foreseeable future.

The American Bar Association (ABA) Journal is doing a survey regarding the current legal recession. Specifically, they are seeking your perspectives about the current state of the legal economy. I personally am hoping this will be a great time for small firms and solo practitioners. What do you think? Take the survey here:

New York (September 4, 2008) – The road from invention to commercialization can be a difficult one to navigate. To help IP owners overcome the many challenges lining that path, experts from Innovation International Americas (IIA) have developed a set of best practices uniquely designed to meet the needs of inventors, technology transfer offices, and IP practitioners. With offices in New York City and the Bay Area serving the global intellectual property community, IIA focuses on streamlining the exchanges between intellectual property owners and organizations seeking to commercialize their IP, enhance their IP portfolios, boost product development strategies, strengthen their position in the marketplace and maximize the return on their IP portfolio investment.

“Based upon our team’s collective expertise, numerous conversations with experts in the field and extensive research, we discovered that the individuals behind inventions are oftentimes ill-equipped to address the pragmatic concerns of potential licensees for their IP,” commented Douglas Adams, vice president of technology commercialization at IIA. “The real-world benefits of new technology can get lost in translation when a technically-savvy inventor attempts to communicate them to a product development or marketing executive, for instance.”

With that in mind, IIA executives offer clients three essential tips for the successful commercialization of IP:

Know the marketplace. Who are your competitors both market-wise and research-wise? So many times inventors have met their competitors but haven’t focused on licensing. Nurture those relationships.

Highlight the advantages. Inventors often take for granted the advantages of their invention, but they make all the difference in the world when they’re talking to the marketplace. You should also evaluate advantages that might exist for your IP in entirely different marketplaces.

Speak the right language. If you’re too technical in your pitch, you risk losing the interest of business development, licensing or technology transfer departments. Inventors and IP owners love to talk about their technology using scientific terms, but business people often don’t understand those terms. To complicate things even further, there may be a cultural or language gap. Find someone to bridge that gap. Outside companies like IIA can help translate your invention into market language.

About Innovation International AmericasBased in New York City and the Bay Area, Innovation International Americas (IIA) is a premier provider of IP commercialization services to companies and academic institutions. IIA offers a full suite of services to help customers maximize the value of their companies, generate and maintain revenue streams, as well as continue to foster innovation. IIA services include IP marketing, in/out licensing, IP valuation and IP assessment. For more information visit http://www.iiaip.com.

The Trademark Trial and Appeal Board’s litany of holdings in Medinol1 and its progeny make clear that material misrepresentations made during the course of prosecuting or maintaining trademark registrations can result in serious consequences, including the cancellation of any involved registrations on the ground of fraud. Given the TTAB’s increasingly hard-line stance on the issue of fraud, trademark owners and practitioners should consider taking additional steps to avoid future inaccurate statements and minimize the potential impact of any inaccurate statements made in the past.

Review and Document

Before submitting any filing supported by a declaration,2 carefully review the identification of goods and services identified in the filing. Parse out the identification into an item-by-item checklist and then obtain documentation (e.g., a photograph of the mark applied to the goods or an actual advertisement showing the mark in connection with the relevant services) for each individual item specified in the list. This documentation should be kept as a permanent part of the trademark file. If there are any goods or services identified in a filing that are not in use in commerce as of the signing date of the declaration, revise the filing accordingly before submission to ensure that the list is accurate.

Audit

Conduct an audit of the key trademark registrations within a trademark owner’s portfolio. Review all filings involving identifications of goods and services that are supported by a declaration. For each of these filings, make an item-by-item checklist of the identification of goods and services and attempt to verify the accuracy of the declaration. For example, to confirm the accuracy of a declaration supporting a Statement of Use signed on March 1, 2000, for an application covering “hats, mittens, and scarves,” a trademark owner must have been using the mark in commerce for each of the three items in the application on March 1, 2000. If there is reason to believe that a declaration supporting any of the filings is inaccurate, consider filing an additional application as a “safety net.”3

Strategic Filing

In some cases, a trademark owner may offer one or more “core” products or services that it anticipates providing indefinitely, but may also use its mark for a variety of other goods and services that change from time to time. In such situations, it may be desirable to file one application covering the core products or services, and one or more additional applications for secondary products and services, especially where there is an extensive and changing list of secondary products and services. By compartmentalizing the core products or services separately from secondary products and services, even if the registration for the secondary products and services were to be cancelled as a result of a fraudulent declaration, the owner would be able to maintain its registration for its core products or services without fear of challenge on the basis of a fraudulent declaration.

Similarly, where a trademark owner offers products or services that fall in multiple international classes, it may be desirable to file a separate application for each class, rather than combining multiple classes in a single application. By taking this approach, a fraudulent declaration that would ordinarily render an entire multiple-class registration vulnerable to cancellation would instead impact only the goods or services within the single class covered by the registration.

Now more than ever, trademark owners cannot afford to be inattentive to factual representations made during the prosecution and maintenance of their trademark applications and registrations. By implementing these and other common-sense measures, trademark owners and practitioners can help to safeguard their trademark portfolios vulnerability to attack on the basis of fraudulent misrepresentations.

1 Medinol Ltd. v. Neuro Vasx, Inc., 67 USPQ2d 1205 (TTAB 2003). Medinol found fraud based on a trademark owner’s declaration that it was using its mark on all of the goods identified in its registration when, in fact, it was only using its mark on some of those goods. As a consequence of this misrepresentation, the TTAB ordered the entire registration at issue cancelled.

2 Examples of such filings include: (1) statements of use, (2) statements of continued use for listed goods/services in Section 8 Declarations and Section 9 Renewal Applications, and (3) statements of continuous use for five years for listed goods/services in Section 15 Declarations.

Author

Christopher Paul Mitchell (Chris) is a Washington, DC-based patent attorney providing legal services to clients throughout the world. Chris focuses his practice in all areas of intellectual property law, with an emphasis on client counseling, intellectual property procurement, licensing, and litigation support. His patent prosecution experience is primarily in business methods, computer software, and computer hardware.